Finance Ministry to present PM with NIS 80b coronavirus aid package
Intended to cushion economic blow of pandemic, funds include billions for health, unemployment payments for hundreds of thousands of Israelis, help for small businesses
Prime Minister Benjamin Netanyahu is set to review Friday an NIS 80 billion ($22 billion) aid package for the Israeli economy drawn up by the Finance Ministry to confront the crisis brought about by the coronavirus pandemic, his office said.
The package will be based on discussions held in recent days between the Prime Minister’s Office and the Treasury. According to the Calcalist newspaper, the ministry had initially proposed an NIS 40 billion ($11 billion) package but Netanyahu had told them to double the amount.
The package will include billions in unemployment payments to the hundreds of thousands of Israelis who have registered with the National Employment Service in recent weeks after being ordered to remain home and amid a shutdown or near-shutdown of many businesses; billions more in funds for the health system; an aid fund for small businesses affected by the pandemic; grants for freelancers; grants for workers over the age of 67, and more.
Finance Ministry officials had sought a more limited plan, in order to contain Israel’s deficit, which currently stands at some 4 percent. According to Channel 12, officials have warned the package requested by the prime minister could increase the deficit by another 15%.
Other countries have taken similar steps in recent days, announcing huge aid packages that will raise their deficits considerably.
The unemployment rate in Israel continued to rise and on Thursday passed the 20 percent mark (or some 850,000), with 690,000 registering since the start of March and tens of thousands joining them every day. Officials have said the number could pass 1 million by the Passover holiday next month.
The crisis has hit the tourism, restaurant and aviation sectors particularly hard, with layoffs and unpaid leave seen across the board.
Employment Service director-general Rami Garor has said the body estimates that some 20% of those ejected from the workforce during the crisis will not keep their jobs.
The Bank of Israel and retail banks have said they will take a series of policy measures to mitigate damage to the economy, including by buying government bonds, offering repo transactions, delaying mortgage payments, offering loans to small and mid-sized businesses, expanding digital services for remote transactions, and providing courier services to customers in quarantine.
The measures are intended to increase liquidity and decrease volatility in the markets as spending is curtailed by closed businesses, limited movement, consumer fears and plummeting equities.
Israel was edging toward a full national lockdown Friday. As of Wednesday Israelis have been ordered to remain in their homes, except for work purposes or for a small number of specially designated approved activities, including purchasing food and medicine.
Police have increased patrols and enforcement of the guidelines throughout the country. Those found violating the regulations are subject to large fines of upwards of NIS 500 and even imprisonment.
The Israel Defense Forces said Friday that hundreds of armed soldiers would be deployed across the country beginning Sunday to assist police in enforcing the government’s latest restrictions.
The government was also considering ordering a yet more dramatic full national lockdown, in which nearly no one would be allowed to leave their homes under any circumstances other than food and medicine purchases, in a bid to curb the spread of the coronavirus to prevent a collapse of the country’s healthcare system.
According to the Health Ministry, as of Friday morning, there have been 3,035 confirmed cases in Israel. Ten people have died, 49 people are in serious condition and 60 in moderate condition. The vast majority — 2,838 — displayed only light symptoms. Seventy-nine people have fully recovered.